First of all, you have lawyers with whom you should be discussing this matter. If your lawsuit is not exempt, the BK trustee has a right to seize the proceeds from your civil rights action to the extent that the creditors have been discharged. While you feel this is unfair, what is unfair to your creditors is that you are discharged from your liabilities and can still reap the full benefits of a lawsuit which would be considered a nonexempt asset that would change to factors to be considered in determining whether you are a candidate for Ch. 7 or whether/how your are to be discharged.
I am so sorry this issue was not addressed and explained to you when you filed your chapter 7 case. The chapter 7 trustee has the right to take the money from non-exempt assets for the benefit of your creditors. The suit that you describe must not be exempt. The trustee has the right to become the owner of the suit.
Karen J. Porter is licensed in the State of Illinois. An answer to a question on this site does not create an attorney client relationship. It is recommended that you meet with an attorney to receive a thorough and confidential review of your legal problem.
You wrote, "I filed for Ch.7 Bankruptcy which was discharged a little over a year ago. I also filed a sec. 1983 [Civil Rights] around the same time..."
A: If the events giving rise to the 1983 action arose prior to the filing date of the Chapter 7, it ought to have been listed on your Schedule B "Personal Property".
All assets and all liabilities must be listed in a bankruptcy filing. If you had a lawsuit pending or the potential to sue at the time of the bankruptcy filing you needed to list the lawsuit or claim. If the lawsuit or claim was not listed at the time of the bankruptcy filing then the trustee in a Chapter 7 had no opportunity to administer the asset or even ask you questions about the lawsuit. That is a major issue in a Chapter 7. When you fail to list an asset in a bankruptcy then the trustee never abandons that asset because he or she had no opportunity to administer it. The defendant in a lawsuit can raise that issue as a defense because the trustee had the right to sue and settle etc. Follow your lawyers advice
The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of Illinois. Responses are answers to general legal questions and the receiver of such question should consult a local attorney for specific answers to questions.